Agency is the future of Media

There is much dis­cus­sion and hand-wringing about the future of media. As one of the cen­ter of tra­di­tional media, New York is feel­ing the impact, with a lot of the talk at par­ties being about what might hap­pen next. Mean­while, at tech­nol­ogy con­fer­ences, there is much dis­cus­sion about how some of the new tech­nolo­gies may or may not rep­re­sent new media. I would con­tend that agency, or the abil­ity to cre­ate con­tent on behalf of brands may be the future of media.

Tra­di­tional Media Model

In the United States, it appears media com­pa­nies are fol­low­ing three dif­fer­ent mod­els: adver­tis­ing sup­ported (broad­cast TV, for exam­ple), directly paid (first-run movies) or funded by alter­nate means (eg. mer­chan­dis­ing concepts).

The estab­lished mod­els are cur­rently feel­ing pres­sures cre­ated by the rise of dig­i­tal media. Adver­tis­ing sup­ported mod­els, for exam­ple, have tra­di­tion­ally relied on high lev­els of inef­fi­ciency, allow­ing for high priced pro­duc­tions to be paid for by adver­tis­ing. With the rise of online adver­tis­ing, some of those inef­fi­cien­cies were high­lighted and adver­tis­ers have started to put some pres­sures on the adver­tis­ing prices around tra­di­tional media.

Mean­while, directly paid media is start­ing to suf­fer as an explo­sion of cheaply pro­duced con­tent hosted on the likes of youtube is now com­pet­ing for view­ers’ atten­tion. When cou­pled with the fact that some cor­po­ra­tions have tried to com­pen­sate from the lower audi­ences by increas­ing the per unit price of a seat (whether it is a the­ater seat, with Broad­way first run shows now often get­ting $100 per ticket or movies, which are edg­ing closer to $20 per seat), the level of atten­dance at paid media events seems to be decreasing.

Mer­chan­dis­ing still seems to suc­ceed pretty well, with media con­tent now being cre­ated around toys (eg. Trans­form­ers) or web sites (eg. the upcom­ing Onion movie).

The New Media World

Mean­while, around the tech indus­try, there seems to be a grow­ing con­sen­sus that media mod­els will focus around prod­uct, peo­ple, or platforms.

Some peo­ple feel that cus­tomers may con­tinue to flock to estab­lished brand, because of a cer­tain recog­ni­tion of qual­i­ties asso­ci­ated with that brand. They view the prod­uct as key to the poten­tial future of media and look to the estab­lish­ment of new brands as the key to suc­cess in the long run.

Oth­ers look to the future of media as being pred­i­cated on adopt­ing a model that includes a wider group of peo­ple. Whether it is blogs, twit­ter, or other consumer-generated media, this camp looks to the lower pro­duc­tion and dis­tri­b­u­tion costs asso­ci­ated with such model as the sav­iors of the media industry.

Another group looks to the plat­form model, pro­vid­ing tools that enables peo­ple to cre­ate and dis­trib­ute media with­out being involved in any of the edit­ing or selec­tion. Peo­ple look to the cre­ation of plat­forms that can work for dis­trib­ut­ing media across mul­ti­ple chan­nels and pro­vide an accel­er­ated rate of turn-over in terms of the type of media pieces being dis­trib­uted. So basi­cally, plat­forms are a basis for mer­chan­dis­ing cross-sell deals.

The Agency Model

With mer­chan­dis­ing plat­forms being the only arena on which tra­di­tional and new media seem to agree, there may be a chance that the agency model, where com­pa­nies are pro­duc­ing con­tent on behalf of brands, are the future of media.

For exam­ple, one of the biggest suc­cess in online media this sum­mer was the prod­uct of an adver­tis­ing agency: Wieden and Kennedy pro­duced a very suc­cess­ful ad cam­paign for Old Spice, a deodor­ant com­pany, that took the online world by storm ear­lier this summer.

A cou­ple of years ago, Cripin, Porter, Bogusky launched sub­servient chicken, another ad cam­paign that was well received online.

In both cases, the agen­cies have done a great job cre­at­ing char­ac­ters around brands. The chicken was sup­port­ing a Burger King; the old spice guy is ulti­mately push­ing deodor­ant.  In each case, they can be con­sid­ered tra­di­tional ads but the addi­tion of char­ac­ters means that they could build media-like devel­op­ments around the char­ac­ters. And I sus­pect it’s only a ques­tion of time before some char­ac­ters cre­ated for ads start show­ing up in TV shows or movies.

What has got­ten me think­ing that the model for the future of media may be in fol­low­ing the path set by adver­tis­ing agen­cies is that, increas­ingly, when one asks a new media per­son about their busi­ness model, they focus on how they work with mar­keters to reach out to audiences.

The inter­net is equal­iz­ing access not only for peo­ple but also for brands. As a results, brands are now cre­at­ing their own form of media goods to cut through the clut­ter and no longer need to attach them­selves to any other form of media. A clever ad can stand on its own as a media good or a clever sto­ry­line can receive a sudle influ­ence from a par­tic­u­lar product.

In a world where media is increas­ingly dolled out in more of a bite sized form, ads are com­pet­ing for air­time with other forms of con­tent. The future of media com­pa­nies, as a result, is to fig­ure out a way to help those brands break through the noise and, as a result media com­pa­nies may increas­ingly find them­selves at odds with the adver­tis­ing agen­cies they tra­di­tion­ally saw as equal partners.

The ques­tion remains as to what will hap­pen to sub­si­dized media and jour­nal­ism in such a con­text. Will it con­tinue to exist of will those forms of media com­pletely dis­ap­pear? Online time will tell.